BILL ANALYSIS Ó
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THIRD READING
Bill No: AJR 1
Author: Gatto (D)
Amended: 8/26/13 in Assembly
Vote: 21
SENATE JUDICIARY COMMITTEE : 5-2, 6/10/14
AYES: Jackson, Corbett, Lara, Leno, Monning
NOES: Anderson, Vidak
ASSEMBLY FLOOR : 51-20, 1/30/14 - See last page for vote
SUBJECT : Federal constitutional convention: application
SOURCE : Author
DIGEST : This bill submits California's application to
Congress to call for an Article V convention for the sole
purpose of proposing a Constitutional amendment that: (1) limits
corporate personhood for purposes of campaign finance and
political speech; and (2) declares that money does not
constitute speech and may be legislatively limited.
ANALYSIS : The U.S. Constitution, provides that the Congress,
whenever two-thirds of both houses shall deem it necessary,
shall propose amendments to this Constitution, or, on the
application of the legislatures of two-thirds of the several
states, shall call a convention for proposing amendments, which,
in either case, shall be valid to all intents and purposes, as
part of this Constitution, when ratified by the legislatures of
three-fourths of the several states, or by conventions in
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three-fourths thereof, as the one or the other mode of
ratification may be proposed by Congress, except as specified.
Existing federal law, the U.S. Constitution, provides that
Congress shall make no law abridging the freedom of speech, or
of the press, or the right of the people peaceably to assemble,
and to petition the government for a redress of grievances.
This bill:
1. States that:
A. Corporations are legal entities that governments
create, and the rights that they enjoy under the U.S.
Constitution should be more narrowly defined than the
rights afforded to natural persons;
B. Corporations do not vote in elections and should not
be categorized as persons for purposes related to
elections for public office and ballot measures;
C. The U.S. Supreme Court, in Citizens United v. Federal
Election Commission (FEC) (2010) 130 S.Ct. 876, held
that the government may not, under the First Amendment
to the U.S. Constitution, suppress political speech on
the basis of the speaker's corporate identity; and
D. The U.S. Constitution Article V requires Congress to
call a constitutional convention upon application of
two-thirds of the legislatures of the several states for
the purpose of proposing amendments to the U.S.
Constitution.
2. On behalf of the California Legislature and speaking on
behalf of the people of the State of California, applies to
Congress to call a constitutional convention pursuant to the
U.S. Constitution Article V of for the sole purpose of
proposing an amendment to the U.S. Constitution that limits
corporate personhood for purposes of campaign finance and
political speech and further declares that money does not
constitute speech and may be legislatively limited.
3. Declares that it constitutes a continuing application to call
a constitutional convention pursuant to the U.S. Constitution
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Article V until at least two-thirds of the legislatures of
the several states apply to Congress to call a constitutional
convention for the sole purpose of proposing an amendment to
the U.S. Constitution that limits corporate personhood for
purposes of campaign finance and political speech and further
declares that money does not constitute speech and may be
legislatively limited.
4. Declares that this application is for a limited
constitutional convention and does not grant Congress the
authority to call a constitutional convention for any purpose
other than for the sole purpose set forth in this resolution.
Background
Political speech is said to lie at the core of the First
Amendment and to receive the highest form of protection. The
U.S. Supreme Court has considered the First Amendment to the
U.S. Constitution to protect the right to make contributions and
expenditures to support or oppose candidates or issues, as well
as to use such monies by a candidate or committee to promote his
or her viewpoint and election. Such activities have been
equated to speech (or, speech by proxy) or, alternatively, been
protected under the right of association or assembly, insofar as
making contributions or expenditures in connection with
elections is analogous to aligning oneself with certain persons
or viewpoints.
The ability of government to regulate or restrict such political
speech or campaign spending of natural persons, groups,
corporations, unions, or otherwise, has been tested repeatedly.
For many years, the U.S. Supreme Court has drawn a distinction
between "contributions" or "in kind contributions" to candidates
or their committees, and "expenditures" by or at the behest of
candidates or committees or "independent expenditures" by
individuals or committees to expressly support or oppose an
issue or a candidate without any coordination with the candidate
or his or her committee. The test for reviewing any of these
restrictions has been the same: whether the specific regulation
is narrowly tailored to a compelling governmental interest.
Notably, in 2010, and central to this measure, the U.S. Supreme
Court decided Citizens United v. Federal Elections Commission
(2010) 130 S.Ct. 876, 913. In that case, the Court struck down
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limitations placed on a corporation's ability to make political
independent expenditures, holding that such limitations violate
a corporation's right to free speech and stating that the
"[g]overnment may not suppress political speech based on the
speaker's corporate identity." In doing so, the Court
explicitly overruled its prior holding in Austin v. Michigan
Chamber of Commerce (1990) 494 U.S. 692 and part of McConnell v.
FEC (2003) 540 U.S. 93.
The following year, relying upon on the Citizens United
rationale, a federal district court, in Speechnow.org v. FEC
(2011) 599 F.3d 686, held that limits on the use of the
corporate treasury to make independent expenditures are
unconstitutional. Since then, a great amount of national focus
has been given to the rise of independent expenditure-only
political action committees, also known as "Super PACs."
Corporate treasuries can now be used to give unlimited amounts
of money to Super PACs of a corporation's choosing, either
directly or indirectly through a 501(c)(4) (which then gives to
the Super PAC without having to disclose its donors; in turn,
the Super PAC discloses the 501(c)(4) as its donor, not the
actual persons or entities donating to the 501(c)(4)). The full
impact of these "Super PACs," and of Citizens United itself, is
still unfurling, though reportedly, outside spending in federal
elections has already increased substantially-by as much as 245%
in presidential elections, 662% in elections for the U.S. House
of Representatives, and 1338% in U.S. Senate elections. (See
Richard L. Hasen, Three Wrong Progressive Approaches (and One
Right One) to Campaign Finance Reform (2014) 8 Harv. L. & Pol'y
Rev. 21, p. 21, internal citation omitted.)
In April, the Supreme Court rendered another pivotal decision
scaling back campaign finance regulations in McCutcheon v. FEC
(2014) 134 S.Ct. 1434, by striking down aggregate limits placed
on campaign contributions to individuals-despite the fact that
the Buckley Court had previously allowed aggregate limits given
the governmental interest in preventing evasion of base (i.e.
individual) limits. For the first time, the McCutcheon Court
announced that any regulation must specifically "target what we
have called 'quid pro quo' corruption or its appearance."
Holding that "the indiscriminate ban on all contributions above
the aggregate limit is disproportionate to the Government's
interest in preventing circumvention" (of the base limits, which
function as a prophylaxis to quid pro quo corruption), the Court
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held that it "cannot conclude that the sweeping aggregate limits
are appropriate tailored to guard against any contributions that
might implicate the Government's anticircumvention interest."
(Id. at 1457; interestingly, the Court commented on other
anticircumvention-type regulations that might surpass First
Amendment scrutiny.)
Prior Legislation
AB 644 (Wieckowski of 2013) would have required a statewide
advisory vote on the November 2014 general election ballot as to
whether Congress should propose, and the California State
Legislature ratify, an amendment to the U.S. Constitution, to
reverse the Supreme Court's ruling in Citizens United and limit
campaign contributions and spending, in order to ensure that all
citizens, regardless of wealth, may express their views to one
another and their government on a level playing field. The bill
died in the Assembly Elections & Redistricting Committee.
AJR 22 (Wieckowski, Resolution Chapter 69, Statutes of 2012)
memorialized the California State Legislature's disagreement
with the decision of the Supreme Court in Citizens United and
stated, among other things, that California calls upon Congress
to propose and send to the states for ratification a
constitutional amendment to overturn that decision and restore
constitutional rights and fair elections to the people.
SB 982 (Evans of 2012), among other things, would have required
a corporation, as defined, to disclose to its shareholders any
campaign contributions or expenditures made in the previous
fiscal year in support of or in opposition to a candidate,
ballot measure campaign, or a signature-gathering effort on
behalf of a ballot measure, political party, or political action
committee in a fiscal year-end report, and to provide prior
notice of any such contributions or expenditures, as specified.
The bill died in the Senate Banking & Financial Institutions
Committee.
AB 2050 (Allen of 2012) would have prohibited a domestic
corporation from making any monetary contribution to any
candidate for local or state office in this state or any other
state, and to make specified disclosures when making a monetary
contribution in excess of $1,000 to any candidate for federal
office or any statewide ballot, referendum, or initiative voted
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on in this state. The bill died in the Assembly Judiciary
Committee.
AJR 32 (Allen, Gatto, Wieckowski of 2012) would have called upon
Congress to call a constitutional convention to amend the
Constitution to bar "corporate personhood" and declare that
money does not constitute speech. AJR 32 died in the Assembly
Judiciary Committee.
FISCAL EFFECT : Fiscal Com.: No
SUPPORT : (Verified 6/11/14)
California Clean Money Campaign
CALPIRG
Consumer Watchdog
California State Grange
Wolf-PAC
ARGUMENTS IN SUPPORT : According to the author:
In Citizens United, a deeply divided Supreme Court held
that corporations are due the same free-speech rights
enjoyed by natural persons. The decision spawned "Super
PACs," which have flooded unlimited corporate money into
federal elections.
During the 2012 election cycle alone, millions of dollars
were contributed to Super PACs with the hopes of electing
particular candidates to office while defeating others and
seeing certain initiatives codified into law while pushing
others to the wayside. Reports indicate that casino
magnate Sheldon Adelson spent close to $150 million alone
in an effort to defeat President Obama and elect
Republicans to Congress. In California, similar monetary
efforts endured, with over $372 million spent both
promoting and attacking the 11 ballot initiatives on the
General Election ballot. MapLight, a nonpartisan
organization that crunches numbers from the Secretary of
State, reports that the top 20 donors provided 69
[percent] of all initiative funding.
AJR 1 is a reasonable measure that goes a step further
than just requesting Congress act to amend our federal
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Constitution by utilizing the powers of the states,
outlined in Article V of the U.S. Constitution, to force
Congress to call a constitutional convention. Under this
measure, the sole purpose of this convention would be to
propose an amendment to the federal Constitution that
would limit corporate personhood for the purposes of
campaign finance and political speech. It also declares
that money does not constitute speech and may be
democratically limited. Finally, AJR 1 sets forth strict
grounds for this limited convention, explicitly stating
that it not act for any purpose other than limiting
corporate personhood.
ASSEMBLY FLOOR : 51-20, 1/30/14
AYES: Alejo, Ammiano, Atkins, Bloom, Bocanegra, Bonilla, Bonta,
Bradford, Buchanan, Ian Calderon, Campos, Chau, Chesbro,
Dababneh, Daly, Dickinson, Eggman, Fong, Fox, Frazier, Garcia,
Gatto, Gomez, Gonzalez, Gordon, Gray, Hall, Roger Hernández,
Holden, Levine, Lowenthal, Medina, Mullin, Muratsuchi,
Nazarian, Pan, V. Manuel Pérez, Quirk, Quirk-Silva, Rendon,
Ridley-Thomas, Rodriguez, Salas, Skinner, Stone, Ting, Weber,
Wieckowski, Williams, Yamada, John A. Pérez
NOES: Achadjian, Allen, Bigelow, Chávez, Conway, Dahle,
Donnelly, Beth Gaines, Grove, Hagman, Harkey, Jones,
Maienschein, Mansoor, Morrell, Olsen, Patterson, Wagner,
Waldron, Wilk
NO VOTE RECORDED: Brown, Cooley, Gorell, Jones-Sawyer, Linder,
Logue, Melendez, Nestande, Perea
AL:d 6/11/14 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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